The dollar index fell 0.6% over the week, its biggest drop since April. The decline in the dollar pushed the euro close to a two-week high of $1.1454, up 0.6% for the week. The British pound also strengthened to $1.3371, posting a weekly gain of 1.2%, its best performance in nearly three months.
The Japanese yen also found some support, remaining virtually stable at 161.03 per dollar. However, markets remain concerned about the risk of intervention following Thursday’s sharp rally, which lifted the currency from a 40-year low.
The dollar fell due to a sharp slowdown in U.S. job growth in June and downward revisions to wage growth data for the previous two months, prompting traders to scale back bets on an imminent Fed rate hike.
According to data released on Thursday, U.S. nonfarm payrolls rose by 57,000, falling short of forecasts by economists surveyed by Reuters.
According to CME FedWatch data, the probability of a rate hike at the September meeting is estimated at 52%, down from 64% in the previous session. The yield on two-year U.S. Treasury bonds, which are sensitive to changes in interest rates, broke a three-day winning streak, falling by 4 basis points.
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